When David S. Vogel founded Voloridge Investment Management in 2009, he was focused on using his expertise in predictive modeling to identify winning investment strategies. The fund's strategy applied sophisticated mathematical techniques to identify patterns in market data to try to predict which way stocks and futures would move next.
His fund has been remarkably successful, attracting several billion dollars in assets under management. But David’s passion for numbers extends far beyond finance and markets.
With his firm located just north of Palm Beach, Fla., he has been directly impacted by several extremely destructive hurricanes that have hit Florida in recent years. Climate scientists have linked this trend to climate change, and naturally, given his love of numbers, he decided to research the topic and find out whether the data supported this theory.
"As a data scientist I was a skeptic who wanted to get informed," David said.
What he found disturbed him. The data he studied, all of which came from public sources, showed a direct correlation between the amount of carbon in the atmosphere and the temperature of the planet, and between rising temperature and certain types of weather patterns. Furthermore, the data showed clear connections between global warming and real-world trends in economic growth, healthcare and more.
David's fund is now making climate change-related risks and opportunities a logical part of its investment strategies. But he also is making it a core focus for the non-profit that he and his wife, Thais Lopez Vogel, launched in 2014.
VoLo Foundation began as a way for the Vogels to give something back, with a focus on issues they felt drawn to personally including education, poverty and healthcare projects as well as climate change. But roughly 70% of the foundation's efforts have been climate-related.
"There are so many urgent problems other than climate change that are top of mind for people, and most people don't connect the dots. But climate change is a threat multiplier that directly affects all these other issues, from health to the economy to immigration," Thais said in an interview with MarketVoice. "At VoLo Foundation, we've decided this is the issue that matters most, and we have the numbers to back that up."
Part of the foundation's mission is to share those numbers with policymakers. That includes outreach to the U.S. Congress as well as locally in Florida, which features eight of the 10 urban areas most at risk from climate change and was recently called "ground zero in the climate crisis" by the Union of Concerned Scientists.
Thais acknowledged that persuading politicians to take action on this issue can be an uphill battle, but VoLo's data showing the impact on local issues like health and the economy make politicians take notice. She also emphasized that the scale of the problem is so large that individual efforts such as a change in lifestyle simply won't be enough to keep up with the pace of climate change. Both Vogels say that the only meaningful solution is a tax on carbon.
"I'm a free market person, so I believe if the price of everything is actually correct, then the free market will dictate the direction correctly," said David. "If you factor in true costs, damages could be as high as 12 cents per kilowatt hour for certain fuel emissions. It's much cheaper to pay a few cents up front per kilowatt hour for solar or wind and avoid those huge damages down the road. A carbon tax would help correct the current pricing imbalance."
Beyond broad climate change outreach, VoLo Foundation also places data at the center of its day-to-day operations. "We track our progress using a variety of qualitative and quantitative approaches, and we support programs that generate measurable, meaningful, and sustainable results," David said.
For example, the foundation supports a data fellowship at the Environmental Defense Fund, one of the world's largest environmental organizations. This position, which was funded in 2018, will oversee the group's air quality initiative, which is gathering information, developing methodologies to analyze the data, and identifying air pollution trends.
Another example is the foundation's support for a partnership between the World Wildlife Fund and the Colombian government to protect and monitor 49.5 million acres of tropical rainforest. It is estimated that forests around the world consume one to two billion tons of carbon each year, which is a huge part of the estimated 10 billion tons of carbon produced by fossil fuels and other human-related activities.
But exactly how much carbon does a forest consume? The foundation decided to help research this question by providing a grant to support the collection and analysis of data from the Colombian rainforest. Scientists from Stanford University, working with WWF, created high-resolution carbon maps to measure carbon emissions and determine how much carbon is being stored in the forests. The foundation hopes that projects like this will build a scientific case for forest conservation as a viable approach to large-scale climate change mitigation.
VoLo Foundation is also working in collaboration with David Vogel's alma mater MIT to support a study of halocarbons -- chemicals used in household products and appliances that erode the earth's ozone layer and contribute to global warming. In fact, halocarbons have a much higher potential impact on global warming than carbon on a pound-for-pound basis. The study will analyze the amount of halocarbons at risk of escaping and quantify the potential impact of policies to prevent further emission into the atmosphere.
The efforts supported by Volo Foundation involve many different regions and disciplines, but they all share one thing: A focus on using the numbers to tackle climate change and protect the planet for future generations.
"I care deeply about climate change because it's about the future, it's about our kids. But this isn't just an emotional argument, it's one backed up by scientific proof," Thais said. "The data shows that climate change is a real problem. And without data, you're just a person with an opinion."
Learn more about the Vogels' charitable efforts at volofoundation.org.
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- Sustainable Finance